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The scandalous statistical mess around Obamacare

There’s something scandalous going on over Obamacare. No, it’s not the usual stuff: how scandalous it is that the government is interfering again in the market. Nor that opposite: the scandal of why it isn’t all just single payer like it ought to be.

No, this is a scandal that will only seem to be one to political wonks like myself: the most egregious misuse of the statistical system. You see, what has been done is to change the way that the statistics on health care insurance coverage are prepared by the census bureau, meaning that we’ll never actually know whether Obamacare has expanded insurance coverage as it was supposed to.

What we’ll have is the old data, prepared under the old method, and the new data, prepared under the new, and the two will not be directly comparable.

And yes, this is a problem, because you’ve got to be able to measure the effects of a policy so that you can try and work out whether it was successful. You know, so we know whether to use it again, modify it, repeal it, whatever.

The changes are intended to improve the accuracy of the survey, being conducted this month in interviews with tens of thousands of households around the country. But the new questions are so different that the findings will not be comparable, the officials said.

An internal Census Bureau document said that the new questionnaire included a “total revision to health insurance questions” and, in a test last year, produced lower estimates of the uninsured. Thus, officials said, it will be difficult to say how much of any change is attributable to the Affordable Care Act and how much to the use of a new survey instrument.

“We are expecting much lower numbers just because of the questions and how they are asked,” said Brett J. O’Hara, chief of the health statistics branch at the Census Bureau.

Along with Megan McArdle I’m rather shocked that they’ve done this in this one particular year. Not shocked at the desire to do it, of course, I’m much more cynical than that. Rather, shocked that they actually had the courage to make such an obviously detestable change.

I do have to say that US economic statistics can be a little odd at the best of time though. Take, for example, the estimations of the poverty rate. Every other country in the world publishes the number of people in poverty after all the things that have been done to help them out of poverty. And that’s what the US used to do back in the 1960s too. But since then the methods of alleviating poverty have changed from simply giving people cash to giving them benefits in kind, Section 8 vouchers, SNAP, Medicaid, and to giving help through the tax system like the EITC. But when the US calculates the poverty rate it doesn’t include the effects of all of those things that do, obviously and demonstrably, reduce poverty. As an example, child poverty is said to be up over 20% in the US. But when you add in all of the things that are done to reduce child poverty it changes to some 2 or 3% of children in poverty. Which is pretty good going for government work, really.

There’s another related one: the gini index is a measure of inequality, ranging from zero to one. Sweden’s at 0.25 or so and the generally reported number for the US is the Census one, 0.46, 0.47 depending upon the year. But that US one is before the influences of the tax and benefits system, that Swedish one after. It’s simply not comparable. The US is most certainly more unequal than Sweden this is true, but the comparable gini is about 0.38 to 0.25.

So, as I say, I’m not surprised at the statistical representation here in the US being not quite perfect. There are known problems with the way that economic statistics are collected and then portrayed. But this change in the statistics around health care insurance is still shocking. It’s the breathless effrontery involved that shocks, the careful set up of the system so that we’ll never actually be able to tell whether this shake up of the health care insurance industry aimed at increasing coverage has actually increased coverage at all.

Tim Worstall is a Senior Fellow at the Adam Smith Institute in London, a freelance writer whose work has appeared in the WSJ, The Times, Daily Telegraph, The Register, Forbes online and a number of other places. He is also in his day job an expert in the rare earth metal, scandium. A strange thing to be but someone has to be and in this flavour of our universe Worstall is it. He apologises in advance for his Englishness and the manner in which his spelling will waver from accepted American standards at times.